Slidell City Council cuts costs with new health-care plan

In a unanimous vote during their Tuesday meeting, the Slidell City Council approved a new healthcare plan that will save nearly $20 million in unfunded liability by having city employees share in the cost of their health insurance once they retire.

Council members say the changes will keep the city in the black in the wake of skyrocketing health-care costs. The city pays around $1.3 million a year to finance Slidell's plan, which paid 100 percent of the health insurance benefits for retirees who had at least 10 years with the city and one year on the health-care plan.

Council member Bill Borchert ha

s said those costs could grow to between $10 and $12 million annually. The city currently has a $43 million unfunded liability, the amount of money the city is obligated to pay toward employee health care, as a result of its plan, which covered 265 of its 325 city employees.

"After the changes it's $25.9 million, a decrease of $17.9 million," said Borchert.

The new plan will cover retirees on a sliding scale, depending on when they were hired and how many years they were employed by the city or another city-sponsored plan.

For employees hired before Sept. 1, 2008, who retire after 25 years or more, the city will cover 100 percent of the benefits for them and their families. Employees with at least 20 and 10 years of service before retirement will receive 90 percent and 80 percent of the cost of their premiums, respectively.

Employees hired after Sept. 1, 2008, who worked for at least 25 years, 20 years, or 10 years will receive 75 percent, 65 percent and 55 percent of their premiums covered, respectively.

The new ordinance calls for employees to have participated in the city's health-care program for at least five years before retiring, which is intended to prevent people from taking city jobs just to secure coverage for their spouses.

After hearing the concerns of some employees who weighed in on the plan earlier this month, the council added an amendment that would exempt employees from the five year commitment if they join the plan now and retire within five years.

The council also added language that allows employees coming to the city from a different city-sponsored plan, such as one offered through St. Tammany public schools or the New Orleans Police Department, to apply those years toward their retirement, a provision geared toward helping 30 employees who fell through the cracks.

"We basically solved all the problems that you asked us to solve, within reason," Councilman Joe Fraught told residents Tuesday.

City employee Kenny Martin thanked the council for its efforts. An engineering worker with more than 23 years with the city, he would have had to work longer than he planned to secure coverage for his wife, who joined the plan two years ago.

"I know it was a brain-wracker and I appreciate it," he told council members.